ND synthetic gas plant to resume production

BISMARCK — The Great Plains Synfuels Plant in western North Dakota is expected to resume production this week following a of maintenance work.

Dakota Gasification Co., a subsidiary of Bismarck-based Basin Electric Power Cooperative, said the plant near Beulah was idled June 1 and is expected to be at full production on Thursday.

The plant was built in response to the energy crisis of the 1970s to make natural gas from lignite, a low-grade coal that is abundant in North Dakota. The plant's gasification process involves using high-pressure steam and air to break down the coal — about 18,000 tons daily — to make natural gas that is piped to Iowa, where it is distributed to markets in the eastern and southeastern United States. The plant also produces fertilizer and some liquid fuel products.

The process generates carbon dioxide, which Great Plains pipes to oil fields in southern Saskatchewan. There, it's pumped underground to force oil to the surface.

Plant manager Dale Johnson said the $46 million planned maintenance project was only the second planned shutdown of the plant since 2004. He said the work was expected to be completed last week but some unexpected minor problems prevented the plant from ramping up to full production.

In 2007, production was halted for 41 days to repair cracks in a processing unit that extracts chemicals from the plant's synthetic gas. That shutdown was estimated to cost its owners about $1 million per day in lost natural gas and so-called co-product sales, said Mary Miller, a company spokeswoman.

Johnson said the maintenance work done over the past month is in addition to more than $120 million in upgrades at the plant in the past year “that will result in lower maintenance costs in the future.”

The plant began producing gas in 1984, but the factory's original owners abandoned it about a year later, and the Energy Department foreclosed. Basin bought the plant northwest of Bismarck in 1988 for $85 million and agreed to pass on some tax breaks and share revenues if natural gas prices were high enough to trigger the payments.

The Energy Department, which guaranteed $1.5 billion in construction loans for the factory, has recouped more than $1.3 billion when unused tax credits are calculated, the company said. Basin made its final payment to the federal government in 2010.

Miller said Great Plains’ revenues totaled $551 million last year. The plant has about 680 employees.